A crisis in MBA culture? Serious questions for would-be cons

Not that we're ones to blow our own horns here at Vault, but there is an undeniable amount of satisfaction to be gained from writing a blog for CNBC questioning the merits of the MBA, only to find that The New York Times has followed in your footsteps some five months later. Not only that, but it's interesting to note the change in public reaction from the comments received in the aftermath of our piece (many of which aren’t fit to print, and most of which disagreed with us), and the reaction.to the Times piece.

OK, so maybe there's a significant demographic difference between typical CNBC blog readers and those that survey the Grey Lady's daily fare (say it ain't so!). Still, one can't help but get the feeling that public sentiment has shifted against the prevailing business and economic culture the longer this recession has continued. And when every bonus scandal and example of corporate greed that emerges only seems to reinforce the sense that something has gone badly wrong with our culture and values, it's only natural that we start looking at how and where those values were fostered. Thus, the spotlight of late has fallen on business schools, and the type of ideas they've been disseminating on their courses.

The relevance for the consulting industry in all of this, of course, is that so many of its members are what the Times article calls "card-carrying MBA's." The graphic from the Graduate Management Admission Council accompanying the article demonstrates just how widespread the qualification is in the industry: more than 15 percent of all MBA grads end up in consulting, compared to less than 10 percent of the intake who enter B-school from the field. The phrase "gateway credential," then, seems more than fair. The problem, however, is that it's been seen that way in finance as well—and we've all seen how well that particular industry's been doing of late. As Stephanie and I argued all those months ago: "The vast number of MBA degrees currently afloat in the hiring pool may be a big part of the puzzle that’s responsible for getting us into this mess. Whether it's the people, the system, the MBA, or a combination of them all that's responsible for the current crises, it seems reasonable to assume that following the same approach that got us here isn’t likely to get us to where we want to go."

The Times piece goes into more detail on the problems behind the MBA, pointing out that many students "are taught to come up with hasty solutions to complicated problems" and "graduate with a focus on maximizing shareholder value," but "only a limited understanding of ethical and social considerations essential to business leadership." And therein lies the problem for the consulting industry; with those employed within it being parachuted in to fulfill specific, goal-oriented tasks, there's a danger that those same hasty solutions are the ones being rolled out by consultants, with less regard for the long-term stability of a client's business than there should be.

So is there a solution out there? Well, there just might be the seeds of one. The Deans of both Harvard and Yale Business Schools are quoted in the Times piece as seeking a new way forward, and many schools are already fleshing out the leadership, social and environmental aspects of their courses. Other schools may already be there, however. This recent piece in the Wall Street Journal postulates on the benefits of US students getting an MBA abroad—benefits that include such immediate considerations as cost and the ability to "internationalize" your resume at a time when the US job market is weaker than in other parts of the world. More importantly, it's also an opportunity for MBA students to step outside of the standard approach to business education and to benefit from an outside perspective on the US corporate world.

One doesn't need to head to Paris or Dubai to reap the benefits of an alternative approach to doing business, however. Bnet reports that the new director of Dalhousie University's School of Business Administration in Canada not only thinks that "business schools have created the crisis we're in," but is seeking to implement "a core concept of responsible leadership" within Dalhousie's business school.

Now if only we can get that core concept in charge of AIG…

Posted by Phil Stott